Tag: success story

When it comes to strategic acquisitions, Indian Fintech industry is perhaps one of the most vibrant and active. Ever since demonetization, we have rapidly shifted gears towards comprehensively digitized and tech-enabled finance. The next overhaul came in July 2017, when GST was launched across the country – once again this time, our Fintech innovators stole the show. Earlier this year, SahiGST – a game-changing tech startup that revolutionized GST filing and compliance – was acquired by Pune based Vayana Network. This is the story of their inspirational journey, brought to you by Indiabizforsale.com in conversation with Annkur Agarwal – co-founder of SahiGST & Pricebaba.

Inception: How It All Started

Back in 2002, when Annkur Agarwal started out as an online retailer, he got the taste of the exciting world of entrepreneurship for the first time, and since then there has been no looking back. The startup wave in India picked up around 2010, and 2 years later the technology bug bit Annkur as well. With a founding team of 4 core members, Pricebaba was born – an intelligence product research engine that helps consumers find the right product at the right price from the right seller.

Four years went by, with Pricebaba going strong for the most of it. Meanwhile, in 2016, the Government announced GST rollout plans for 2018, inviting technopreneurs to build the Google of GST with licensed APIs. It is around this time that Dinesh Tejwani – one of the investors in Pricebaba – reached out to the cofounders with the idea of SahiGST – a cloud based comprehensive solution for businesses for simplified GST filing and hassle-free compliance management. The market opportunity seemed lucrative, and building such a challenging product was any coder’s dream. Thus, with a lean team of 6 – i.e. 5 co founders (Annkur and 3 others from Pricebaba and investor Dinesh Tejwani) along with a domain consultant in GST, SahiGST kickstarted in December 2016. After the first few months of product conceptualization, the team strength grew to 15, focusing primarily on product development and testing.

Product Launch and Challenges

For Annkur and team, this was not a smooth ride – and nor did they expect it to be. Like any other major economic overhaul, GST brought with it intense legal and political volatility that translated into chaotic product development. To start with, the various provisions, categories, rates, and procedures underwent massive changes in the months leading up to the rollout – which were also incidentally the peak months for product development. The cofounders at SahiGST had already been forewarned of such a possibility by their domain expert, but even so it was a roller-coaster ride to keep up with the ever changing provisions. After months of burning midnight oil, when they finally started eying April-March for a grand launch of SahiGST, the rollout was again pushed back to July 2018, and more changes were ushered in – though mostly incremental this time.

Annkur shares with us how his team’s decision to bootstrap SahiGST instead of seeking external investment proved to be critical to survival in hindsight. As he writes in his blog, “Given the volatility around GST & its implementation, we knew that… deploying any funds (specially borrowed) in an aggressive manner might be a gamble… We could build a great product with two technical co-founders & three founders focussed on marketing, sales and support. So…[we] ran a lean ship instead of expanding prematurely. In hindsight, that went just perfect, had we invested too heavily, we would have burnt a lot of money in vain…”

Indeed, this master plan worked perfectly. Undeterred by the long gestation period, when GST was finally launched in July 2017, SahiGST became the first player using Govt. API to go live and turned cash positive within 2 months of launch!

Partnership with Vayana Network

The acquisition of SahiGST by Vayana Network goes way back to the partnership between the two entities during its early days.

To begin with, let us first understand how the GST implementation works in simple terms. The first key player is the GSTN –the Goods and Services Tax Network (GSTN) is a non-profit, public private partnership company. Its primary purpose is to provide IT infrastructure and services to central and state governments, taxpayers and other stakeholders, thereby facilitating the implementation of the Goods and Services Tax (GST). The next key components are GSP and ASP. In a nutshell, taxpayers interact with the GST filing system through secure GST System APIs that are developed and serviced by third parties called GST Suvidha Provider (GSP) and Application Service Providers (ASP). ASPs take taxpayers’ raw data on sales and purchases to arrive at the net GST returns, which are then filed via the GSP. ASPs, therefore, act as the link between the taxpayers and the GSPs.

Vayana is a pureplay GSP which enabled SahiGST (an ASP), and thus a partnership blossomed. What started out as a sheer tech-based symbiosis, soon transformed into a partnership of mutual understanding and shared vision. As the working relationship continued to grow in strength and purpose, a new pattern emerged in the market opportunity for SahiGST.

Annkur and team had started out with the notion that they would be servicing a fragmented market mostly consisting of SMEs and small CA firms. However, within a short span of time, larger corporate clients looking for enterprise and conglomerate level solutions flocked to the product. They realized that while this was a pleasant and welcome surprise, to service and compete in this larger and more competitive market space required much deeper pockets, bigger and stronger team and more energy to be directed away from Pricebaba into SahiGST. The team began to wonder whether seeking strategic sale to the right buyer was the best way to go. Opportunity arrived at their door when their robust relationship with Vayana Network paved the way for an acquisition deal to emerge on the table.

Acquisition: How It Happened

Annkur had already anticipated the possibility of a deal when the CTO and CEO of Vayana Network reached out to him, stating his intent to pursue an acquisition – interestingly, the two of them had already met each other 9 years earlier at an event in Pune. Annkur chuckles, “It is amazing how life comes circling back to you – one should never underestimate the value of network and relationships.”

Things moved quickly from there in the first few months, since Vayana was already familiar with the business and technology details of SahiGST. Even so, Vayana conducted a thorough and meticulous due diligence with the help of seasoned professionals. On the part of SahiGST, Dinesh Tejwani spearheaded the deal, with the former’s extensive experience in deal-making coming to much aid. After a reasonable amount of negotiation, the valuation figure was finally pegged close to the first figure expected by SahiGSt team in the beginning of the deal. He recalls with some frustration the speed breaker that they reached during deal structuring, when lawyers were doing their thing – with elaborate grinding on each and every aspect of business, technology, IP, employee, customer, transition and so on. However, he shares his appreciation for decision makers at Vayana who expedited the deal and respected the timelines that he had quoted to them. Since the licenses of SahiGST users was due for renewal in April, the deal closed at the right time for a transition to Vayana being announced to customers & partners.

The transition too, took place in a highly cooperative spirit. Annkur and his team committed to support the transition process till July, 2018, although it was wrapped up much earlier. Interestingly, in a different turn of events, one of the co-founders exited Pricebaba team and joined Vayana to lead and manage the acquired SahiGST platform hands-on. With SahiGST off the table, Annkur and others now hope to focus full-time on Pricebaba and take it to new heights.

Key Takeaways

Opportunities don’t last forever – be quick in identifying a market opportunity before it’s gone!

Stay lean and focused – it will help you survive during chaotic times

Nurture relationships with patience – the right partnerships can bring you extraordinary rewards

Learn to let go – transition the business into able hands when it’s time.

“If you want to go fast, go alone. If you want to go far, go together.”

Mergers and acquisitions have come of age in India only recently, especially among small businesses and mid-cap markets. Amidst the recent developments in SME mergers, one story is particularly close to our heart – our technology platform Indiabizforsale.com, the most preferred network to buy, sell, fund and grow businesses in India, has been instrumental in bringing together Value Insource India and Buzzworks Business Services in a highly synergistic merger transaction. Here, we share with you their success story and the inspirational journey that culminated into it.

Buzzworks – The Journey

Founded in 2001, Buzzworks Business Services operates as two distinct entities in Services and Software. Their solutions take up customers payroll and compliance loads under a single window, and under the leadership of serial entrepreneur, speaker, startup mentor and investor V C Karthic, Buzzworks today serves over 100 clients and manages 100 million calls and 10,000+ staff across 500+ workstations annually. They have booked an annual turnover of nearly INR 100 Cr in the recent years.

Indiabizforsale.com has been working closely with V C Karthic for a while now. Speaking about his experience with Indiabizforsale.com, Karthic is quoted to have said, “…we approached Bhavin and the team at IndiaBizForSale.com. They suggested some readily available opportunities on their platform in our sector, but were not of perfect match to our requirements. We worked out possible companies in our target list and the team at IndiaBizForSale.com worked on the marketing campaign for our interest to generate more leads. Within the first week of the engagement, the team at IndiaBizforSale moved efficiently and professionally…” Further, commenting on the recently closed merger, Karthic says, “Relationships like this allow us to combine the agility of a small company with the nationwide reach of a conglomerate. We are sure that this is just a precursor of larger impact happenings, both from this union as well as some exciting partnerships that we have identified in the near future.”

Exploring Synergies with Value Insource India

In 2011, Buzzworks received PE funding from UAE based Innovations Group. At present, Innovations Group has 40% stake in the company. Soon, Buzzworks grabbed the eyeballs of the strategic team at Value Insource India, which has been operational in human resource outsourcing since 1999 with over 3000 resources and clients across 15+ industries. Pepsi, Acer, WIPRO, Pantaloons, Talwalkars Better Value Business, HDFC Bank, and HSBC Shared Services are some of their prominent clients. What started out as a keen interest and curiosity, soon revealed the underlying potential of matchmaking between the two entities.

Meticulous deal preparation, intensive due diligence and several hard negotiations later, a deal finally emerged on the plate. and Commenting on the merger, Balram J Menon , Managing Director at Value Insource India Pvt. Ltd. said, “We are excited about the future possibilities of this relationship as it combines our niche strength with the delivery capabilities and processes of Buzzworks. We are confident of creating a multiplier effect in the market. This merger allows us to expand pan India and add significant value to customers as well as our bottom lines.”

Concluding Note

We at Indiabizforsale.com are proud to have facilitated and enabled this exciting transaction and would like to congratulate Value Insource India and Buzzworks for combining their complementary competences. It will be fascinating to see their joint growth path evolve and reach new heights. We look forward to bringing more such inspirational success stories to you. To know more about what we do and how we can help you, please visit www.indiabizforsale.com

In just a course of few months after IndiaBizForSale started its venture in India to make the business buyers and the business sellers meet, it successfully helped a professional business broker find a financial institution in Chennai he was looking for his client to acquire for further expansion of his business.